Crisis Management

September 11, 2001 was a devastating reminder of the need to be prepared for crises. Crises are rarely as massive and appalling as the attacks of September 11. But the possibility of crisis calls for constant vigilance and readiness. Being prepared for a crisis involves more than the capacity to manage the crisis itself; it means having the resources and resilience to continue operations.

What is a crisis? Basically it’s a decisive moment a turning point in events. You may say, it is the moment from which an illness may go onto death or recovery. More loosely, it is a term meaning 'a testing time' or 'emergency event'.

A crisis has many sources some you may face and are common to all Organisations. Others are Specific to certain Industries to simplify you can put them into three groups, based on their severity, frequency and timing:

Operational crises are the day-to-day, minor crises of running the organisation and serving individual customers. With good management you can avoid or promptly resolve this type of crisis.

These can normally be broken down into:

• Financial crisis - short term liquidity or cash flow problems; and long term bankruptcy problems
• Public relations crisis - More commonly called "crisis communications," negative publicity that could adversely affect the success of the company
• Strategic crisis - changes in the business environment that call the viability of the company into question - for example the introduction of the automobile was a strategic crisis for buggy-whip manufacturers

Sudden crises are events that occur unexpectedly and have a major effect on the organisation. These include natural disasters, sabotage, Staff Kidnappings and outages of vital services such as power, water or computers. A sudden Crisis calls for you to make prompt, decisive action. Effective communication and teamwork between board members is essential

Potential crises are serious problems that grow larger over time and become critical if they are not addressed. They include declining sales, profits and share prices, failure to respond to new competition, investigations by regulators, and financial difficulties. These problems affect the long-term viability of the entire organization and should be addressed by the Board of Directors through the strategic planning and risk management processes. These groupings of crises are linked. For example:

• Operational crises may be symptoms of potential crises.
• Operational crises can build or blow up into sudden crises.
• Potential crises may weaken an organization to the point that it cannot cope with a sudden crisis.

Being a relatively new field of management and typically proactive, Alba Consec's activities include forecasting potential crises and planning how to deal with them, for example, how to recover if your computer system completely fails. Hopefully, your company have time and resources to complete a crisis management plan before they experience a crisis. Crisis management in the face of a current, real crisis includes identifying the real nature of a current crisis, intervening to minimize damage and recovering from the crisis. Crisis management often includes strong focus on public relations to recover any damage to public image and assure shareholders that recovery is underway. (The library includes a variety of related topics.) Alba Consec can formulate a Crisis management plan for you or your company for further Information please fill in the form below.